The travel and tourism industry is facing a new set of challenges with rising labour shortages, inflationary times and rising economic uncertainty. This is increasing the pressure on urban environments and cities to improve efficiency, mitigate the impacts of climate change, support smart urban development, boost green credentials and enhance the tourism offer in a post-pandemic period.
Euromonitor International’s Top 100 City Destinations Index 2022 uncovers the top city performers for economic and business activity, with thriving tourism infrastructure and performance that show great potential for investment and operation amid increased digitalisation, technological advancement and sustainability developments.
2022 marks a period of strong recovery for travel and tourism. Cities around the globe have benefitted from travellers eager to once again embark on domestic and international leisure trips, whether to visit family and friends after years of separation or to partake in revenge travel, making up for missed trips during the pandemic.
European cities continue to lead with 40 cities represented in Euromonitor International’s Top 100 City Destinations Index 2022. The Index shows that 45 cities have risen in rank, with some of the largest increases attributed to Asian cities.
Asia has experienced a mixed performance due to travel restrictions. The 42 cities represented in the Index from emerging and developing markets have witnessed a net increase in rank due to improved Tourism Performance and Health and Safety.
While 2022 has been a positive year for travel and tourism, the road to full post-pandemic recovery is long, and government support remains critical across all regions.
Top 10 City Destinations of 2022
Paris accelerates to once again claim the title of the world’s top city in 2022, closely followed by Dubai, which retains its second position. The top 10 rankings see the hegemony of European destinations, with only Dubai and New York challenging the status quo this year.
The strong rebound of international tourism, which is projected to register 112% growth in 2022 in terms of inbound spending, has been one of the key factors behind the resilient recovery of global cities. Intra-regional travel, an easing of travel restrictions and value-driven tourism further boost their appeal. Preferences for domestic travel and short-haul flights are defining consumer behaviour when choosing where to holiday.
Lingering risks such as skyrocketing inflation and worsening economic conditions alongside the war in Ukraine cast a shadow over the pace of the recovery by year end.
Performance by Region
With 18 cities in the Top 100 City Destinations Index 2022, the Americas is the region with the third largest number of cities.
Gains in the Tourism Performance pillar have led to improved rankings for five US cities in 2022. Domestic tourism has continued to grow in the country in 2022, but the primary reason for improved performance has been the strong recovery of international demand.
With 26 cities in the Top 100 City Destinations Index 2022, Asia is the second leading region, following Europe. However, despite the large number of Asian cities featured in the Index, none appear in the Top 10 in 2022.
Singapore is the leading Asian city in 15th position, followed by Tokyo which is ranked 20th. Tourism Policy and Attractiveness, and Health and Safety are the pillars with the greatest improvements in ranking for this region in 2022.
Paris has retained the title of the world's leading city following exceptional performances across the Tourism Policy and Attractiveness, Tourism Infrastructure and Tourism Performance pillars and has once again been crowned the region's best-performing destination. Italy (six cities), Spain (five cities) and Greece (four cities) are the leading countries in Europe with a strong destination presence in the Index.
Middle East and Africa
In 2022, 14 destinations from the Middle East and Africa feature in the Top 100 City Destinations Index, compared to 16 in 2021. The leaderboard remains unchanged year-on- year, with Dubai cementing its first place for a second consecutive year in the region, whilst ranking second in terms of overall Index performance. Dubai has had a stellar 2022 following the revival of the MICE tourism segment post-pandemic and Expo 2020 Dubai.
The cities from the region perform best in terms of the Health and Safety, Economic and Business Performance and Tourism Performance pillars.
Resilience and innovation at the heart of city development amid growing uncertainty
Revival of tourism demand
2022 has seen the removal of mandatory quarantine for inbound arrivals and abolishment of mandatory PCR tests across many regions, with these easing at a slower pace in Asia. This has resulted in dramatic rises in inbound arrivals across cities worldwide.
Local governments remain focused on developing cities' infrastructure and tourism facilities to cater for the increasing demand whilst tackling labour shortages.
Innovation, smart tourism and high revenue-driven segments on the agenda
Cities have been extremely proactive in exploring new market segments to help sustain long-term resilience. Greater focus on subsidising the MICE sector, enhancing luxury hotel supply, and improving their infrastructure to appeal to digital nomads will continue to define their long-term strategies.
Integrated shared mobility plans and a shift towards full electrification of city transportation will further shape urban centres. Many destinations are increasingly adopting smart city approaches, which are in turn transitioning into the metaverse space to help enhance user experience, drive engagement, and allow accessibility for visitors.
Sustainability to the fore
Sustainability will remain central to the development of urban destinations, with more sustainable practices being seen by both players and consumers as travel and tourism becomes more mindful and responsible.
Efforts by local cities are expected to push sustainability further to the fore, prompting further innovation in line with environmental and social responsibility.
Note: The publication of this report is in partnership with Transparent Intelligence, which has provided city level data for short-term rentals data (outlets, occupancy, average daily rate, reviews score) to be incorporated as part of the Top 100 City Destinations Index 2022.
For further insight and full market data, see the report Top 100 City Destinations Index 2022.